CORP FIN--CONNECT ONLY+PROCTORIO+180 DAY
CORP FIN--CONNECT ONLY+PROCTORIO+180 DAY
12th Edition
ISBN: 9781266118562
Author: Ross
Publisher: MCG
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Chapter 20, Problem 4CQ
Summary Introduction

To explain: The reason for underpricing being not a great concern with the offering of bonds.

Bond:

Bond refers to the securities, which are traded in public to raise the capital when needed. It is an investment with a fixed income, where an investor gives money to an entity or individual for a specified period of time at a fixed rate.

Underpricing:

The term underpricing refers to the offering of the stocks or the bond at a low price than before. The stocks or the debt are said to be underpriced when they are traded at a lower price than on which it was issued first for trade.

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